CA suspends 345K disability claims as scammers take to impersonating doctors

SACRAMENTO, Calif. -- 7 On Your Side has reported on massive fraud at the Employment Development Department: scammers collecting billions of dollars in unemployment benefits.

Now it's happening again -- this time with EDD's disability payments. Scammers using stolen identities to file phony disability claims.

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The EDD has now frozen 345,000 disability claims hoping to stop the latest fraud. It suspects most are phony -- but the EDD admits some are legitimate claims for benefits to the sick and disabled.

Many are now saying they were cut off without notice.

"It's absolutely ridiculous anyone has to go this long with no pay and no answers. That's the frustrating part," said Baily Graham, a disability claimant.

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A state auditor reported in January said the EDD gave out $800 million in jobless benefits to inmates who fraudulently filed. Now, innocent people say they're being entangled in a crackdown on fraud they have nothing to do with.

"It's déj vu all over again," said State Assemblyman Jim Paterson (R - Fresno). "The EDD is once again treating legitimate claimants this time with disability claims as if they might be scammers."

7 On Your Side has learned the problem began with a medical database breach -- scammers stole identities of hundreds of doctors, then used their credentials to authorize fake disability claims. The EDD blocked 27,000 physician accounts it believes are the imposters.

It will now require real doctors to verify their identities before they can authorize disability payments. The EDD hasn't said how much money it has paid to the scammers.

Take a look at more stories and videos by Michael Finney and 7 On Your Side.

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